No integration with system: FBR orders hefty fines on corporate taxpayers
ISLAMABAD: The Federal Board of Revenue (FBR) has ordered the imposition of huge penalties on corporate sales taxpayers across Pakistan, who failed to integrate with the board’s system.
Resultantly, field formations are issuing penalty notices to the corporate sales taxpayers despite the FBR’s commitment of extension in deadline for corporate taxpayers during last meeting of Senate Standing Committee on Finance.
For corporate registered persons, the date of registration/integration was July 1, 2025 and non-corporate registered persons August 1, 2025.
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According to the FBR’s recent instructions to the field formations, “I am directed to state that the worthy Director General (IT&DT) has issued instructions regarding issuance of penalty notices to taxpayers who have as yet not integrated themselves with FBR as per provisions of Rule 150Q of the Sales Tax Rules, 1990 read with SRO.709(I)/2025.
The matter may please be accorded top priority in accordance with the above and Board’s ongoing drive of integration of un-registered taxpayers, the FBR’s instructions added.”
During the last meeting of Senate Standing Committee on Finance, the FBR has assured to extend deadline for integration of sales taxpayers. The FBR has decided to implement policy of sales tax integration in phases and sector wise. Similarly, non-corporate taxpayers would be given extension in this regard.
The FBR had assured the committee that the FBR will soon issue sales tax explanatory circular to address all concerns of the business community.
Meanwhile, the FBR has officially reconstituted the committee responsible for evaluating applications related to the integration of registered persons under the Sales Tax Rules, 2006.
A formal notification in this regard was issued by the FBR on Monday/28.07.2025.
The move comes amid growing anticipation within both the corporate and non-corporate sectors for an extension in the deadline for sales tax integration. Tax professionals have indicated that businesses are awaiting clarity from the FBR regarding future compliance timelines.
According to the new notification, the FBR has rescinded its earlier directive issued under Notification (IR-Ops)/2025-R dated 16.06.2025. The reconstitution exercise has been carried out under the powers granted by the Sales Tax Act, 1990; the Sales Tax Rules, 2006; the Income Tax Ordinance, 2001; and the Income Tax Rules, 2002.
The newly-formed committee will now oversee the evaluation process of licence applications for integration. It will be chaired by Mr. Abid Mehmood, Director General (IT & DT), with the other members.
The committee’s Terms of Reference (ToRs) include:
Scrutinising submitted documents and determining eligibility for new registrations;
Reviewing additional documents in previously approved registrations under updated rules;
Preparing Requests for Proposal (RFP) in line with the new regulations;
Assessing complaints and making recommendations for licence cancellations to the FBR.
The FBR confirmed that this notification replaces all prior orders concerning this matter and has been issued with the approval of the competent authority. The step reflects FBR’s continued efforts to streamline tax administration and promote transparent integration processes.
Copyright Business Recorder, 2025
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